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InternationalInternationalInternationalInternationalInternationalCoffeeCoffeeCoffeeCoffeeCoffeeMeetMeetMeetMeetMeetWayanadWayanadWayanadWayanadWayanad20072007200720072007

InternationalInternationalInternationalInternationalInternationalCoffeeCoffeeCoffeeCoffeeCoffeeMeetMeetMeetMeetMeetWayanadWayanadWayanadWayanadWayanad20072007200720072007

Background to theInternational Coffee Meet

The effects of the fall of global coffee prices to athirty-year low in 2002, on key stakeholders,especially small-producers, in India has notreceived the attention it deserves and while therehave been several analyses of the global coffee crisisin Latin America and Africa.

The contribution of coffee in India’s grossdomestic product (GDP) is small – a meagre 0.19percent in 1994-95. However, it is much moreimportant for the economies of the states inwhich it is grown. Coffee contributes between 3to 4 percent of the GDP of Karnataka, the largestcoffee-producing state of India. An estimated 5million people, directly or indirectly, depend oncoffee in the three southern states of Karnataka,Kerala and Tamil Nadu for their livelihood. Thereare 178,000 holdings in India, of which 98.4percent are less than five hectares in size and fallsunder the category of small holdings as per theGovernment of India’sdefinition.

Indian coffee farmers,mostly poor small holders,still sell their coffee beans formuch less than they cost toproduce. Small-scale coffeefarmers and farm workers arestill vulnerable to the priceswings in the coffee marketand the disproportionatemarket power of local buyers,international traders andmultinational coffeecompanies.

Suicide deaths haveemerged as an annual trend in

the rural scene in Karnataka. According to mediareports, to date more than 200 small coffee growershave killed themselves, unable to grapple with thecrisis. In Wayanad district of Kerala, 94 farmers,trapped in a vicious cycle of mounting loanliabilities, committed suicide between May 2001and June 2004.

Such kind of an alarming situation would leadto fall in the quality of coffee produced and, in thelong run, would affect all the actors in the valuechain – a fact agreed by the Indian coffee traders aswell.

There is a valid concern that such a situationcould lead to a decline in the quality of coffeeproduced, which, in the long run, could affect allthe actors in the value-chain.

In order to address this and other relatedconcerns, a meet of various stakeholders under thebanner of ‘International Coffee Meet’ was convened

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by Partners in Change in alliance with South Indian Coffee Growers Associationat Wayanad in Kerala in April 2007.

The Wayanad Meet was as an assembly of growers, planters, coffee farmworkers, concerned NGOs and individuals that discussed issues related toimproved social, environmental and economic practices of all stakeholders acrossthe supply chain. Remunerative prices for small coffee growers and fair wages forworkers, better access to markets, reputational benefits, increased workers’satisfaction and loyalty leading to increased productivity, increased savingsthrough better environmental management and reduction of cost of productionare some of the direct impacts that could result from a concerted effort inhighlighting the needs of the coffee sector.

The Wayanad Meet was attended by representatives of farmers and workers inKenya and Brazil and from the Dutch Coffee Coalition, an alliance of NGOs andtrade unions based out of Netherlands, lobbying in Europe on behalf of coffeefarmers and workers in the Southern Hemisphere.

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Declared Objectives andExpected Outcomes

ObjectivesTo synergize on the various strategies adoptedin the coffee sector in the continents ofAfrica, Latin America and Africa. To be donethrough identification of CSR campaigns,information sharing (materials, actions,testimonies, strategies) as well as throughworkshops.

To build capacity of civil societyorganizations to negotiate and engage withother stakeholders based on increasedknowledge of the situation and forces in theglobal coffee trade.

* To agree on a series of recommendationswhich would be forwarded to different stakeholdersin the coffee supply chain to transform the industryinto a sustainable sector.

Tow explore the possibility of forming anational network of organizations in thecoffee sector of Kerala, Tamil Nadu andKarnataka.

To agree on a plan of action for all the threestates to initiate programmes to improvequality, on the one hand, and social andenvironmental concerns, on the other.

Expected OutcomesImproved understanding of small farmers onsocial, economic and environmental issuesglobally and on the strategies adopted bydifferent organizations in India and abroad.

A network of small coffee farmers andworkers formed and a plan of action adoptedfor cooperation and collaboration locally,nationally and internationally

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The first-ever meet of coffee growers and otherstakeholders in the coffee sector withrepresentatives from Africa and Latin America,India and other Asian countries was held inSulthan Battery, Wayanad district of Kerala onApril 12 and 13, 2007.

The first day was the representative meeting ofdelegates from various coffee growers’ associations,planters’ bodies, trade unions, non-governmentorganizations and political formations.

Dr. Baerbel Weiligmann, Chairperson of theDutch Coffee Coalition inaugurated the meet. Shesaid that support from people in India would herand the Coalition to fight against the multi-national corporations on behalf of the beneficiariesof the industry including the farmers. Mr. P.C.Ahmed Hajee, coffee trader and social activist andPatron of the Organizing Committee of the Meetchaired the session.

Also speaking on the occasion were formermembers of the Kerala Legislative Assembly, Smt.K.C. Rosakutty and Mr. N.D. Appachan, formerVice-Chairman of the Coffee Board Mr. K. Moidu,coffee growers Mr. M.A. Mohammed Jamal, Prof.K.P. Thomas and Mr. C.A. Subbaiah (Karnataka).

Process - day 1

Following the inaugural session, therepresentatives’ meeting commenced in whichseveral speakers highlighted the plight of farmersand growers in the coffee sector.

Dr. Weiligmann, in her paper, said thatorganizations like the Dutch Coffee Coalition isworking towards creating an ideal situation incoffee-consuming countries to ensure a good pricefor coffee growers by assisting them to increase thequality of the product. She asserted that ‘certifiedcoffee’ would give the growers and workers a fairdeal in world markets (see elsewhere in this reportfor highlights of her presentation).

George Mwamodo, Coordinator, of the KenyaCoffee Solidarity Network representing the Africanfarmers and coffee workers and Sjoerd Panhzeusenrepresenting the Brazilian coffee sector alsopresented papers, highlights of which are found atthe end of this report. Nallmuthu (Tamil Nadu), K.Mukundan (Kerala), A.C. Varkey of the Farmers’Relief Forum, Prof. P.M. Thomas, former Vice-Chairman, Coffee Board, Tommy Mathew of FairTrade Alliance-Kerala, and C.A. Subbayya (Coorg)and Adv. Venkatasubramania, former Vice-Chairman, Coffee Board also presented papers

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highlighting the plight of the farmers and worker inthe coffee sector in India.

Group discussions and working groups onframing a set of recommendations to variousstakeholders were conducted during the second halfof the first day. Another group was entrusted withthe task of finalizing the Wayanad Declaration(found elsewhere in this report).

In the evening, a public meeting was organized atthe town square to highlight the situation of coffeegrowers and workers. Several of the delegatesattending the meeting spoke on various aspects ofthe coffee crisis in India and elsewhere.

School children from a local school put up athematic variety cultural show depicting thesituation of the farmers and workers in Wayanad.

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The second day saw a packed auditorium withover 1200 farmers and workers from as many as 78panchayats in Kerala, Karnataka and Tamil Nadu.

The Chief Guest of the day was Mr. M.V.Shreyams Kumar, MLA. With Mr. P.C. Ahmed inthe chair, the distinguished speakers of the day were:Mr. N.M. Vijayan, Mr. K.P. Damodar, Mr. ShatadruChattopadhayay, Mr. K.J. Devasia, Mr. Roy David,Mr. Nallamuthu, Prof. P.M. Thomas....

Process - day 2

Smt. Clara and Smt. Mary, widows of two smallcoffee farmers who committed suicide following thecoffee crisis, shared their experience during thecritical years and said that the solidarity lent byPartners in Change and other groups in Wayanadhad stood them in recovering from the shock andhumiliation they suffered on account of theirhusbands’ acts.

The highlight of the meet was adoption of theWayanad Declaration which, among other matters,announced the formation of regional committees inKerala, Karnataka and Tamil Nadu as thepreliminary step towards the formation of anational coordination committee to address theissues confronting the coffee sector (see page 13 forfull text).

The Meet declared its resolution to help coffeefarmers with the support of alternative tradingorganizations, NGOs, government agencies andtrade bodies. Partners in Change will take lead rolein this matter. As a pilot project, 300 farmers fromWayanad region will be adopted by PiC.

Partners in Change announced a margin of Rs. 2per kilogram for ‘certified coffee’, leveraging itsinfluence and contacts with the international fairtrade network. To achieve the certified coffee status,farmers ill have to adopt certain internationally-accepted ethical and ecological standards, for whichPiC will extend technical assistance.

A plan to form farmers’ clusters in rural pocketswas also announced. PiC would facilitate farmersleverage funds from agencies such as NABARD formicro-irrigation projects.

The meet also passed a set of 31 resolutions tobe acted upon by the governments at the centraland state levels and other stakeholders such as theroasters and traders the ICO (see pages 11-12).

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Major Outcomes of the Meet

The first-ever attempt to gather small coffee-growers and farm-workers in coffee holdings in anatempt to consolidate a united voice to highlightthe plight of those involed in the first link in thecoffee chain was held at Wayanad, Kerala, India, onMarch 12 and 13, 2007. Some of the majoroutcomes of the two-day meet are captured below:

Improved understanding on the part of smallfarmers on social, economic andenvironmental issues globally and on thestrategies adopted by different organizationsin India and abroad.

Improved understanding of the how smallgrowers and workers are approaching theissues of sustainable coffee production inBrazil and Kenya and how CSOs inNetherlands and Germany are responding tothese issues throughthe Codes ofConduct.

A set ofrecommendationsagreed upon throuhaprocess ofidentifying theexpectations ofsmall growers,workers’representatives andCSOs fromdifferentstakeholdersinvolved with coffeeworkers and smallfarmers. Theserecommendations

would be forwarded to different stakeholdersin the coffee supply chain to transform theindustry into a sustainable sector.

Formation of Regional Committees (RCs) inKerala, Karnataka and Tamil Nadu which willwork with all stakeholders in the coffeesector. The RCs would have representativesfrom small growers, workers and CSOs.

Partners in Change (PiC) would engage withthe RCs regularly in these states to steer theprocess. All RCs would be supported todevelop a memorandum of cooperationamongst them.

The RCs would work together in theirrespective regions to develop regional as wellas national priorities for all stakeholders. Itwould also initiate a pilot demonstration

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project on sustainability in the coffee sectorthrough quality improvement and trade.

The capacity of RC of linking with the theupper end of the supply chain, particularlythe big companies, would be built up. PiCwould provide a list of such coffee companieswith whom cooperation could be initiated.

The possibility of small coffee growers beingcertified under environmental to be exploredimmediately since the majority of coffee inIndia is produced in an environmentally-sustainable manner without disturbing theeco-system. For the recrds, most of the coffeeis grown in the Nilgiri biosphere, identified asone of the global hotspots.

Regular exchange between coffee-producingregions in the country should continue for

mutual learning. The acton step in thisdirection is ‘exchange visits’ between regions.

Formation of a National CoordinationBody/National Reference Group/IndiaCoffee Alliance/Coalition comprising smalland big growers, planters, workers, tradeunions and CSOs engaged in the livelihoodissues of those in the coffee sector to beformed as a bargaining forum. The principalobjective of the national body would be todevelop a coherent, collective andcoordinated approach for quality – social,economic, and environmental – in the coffeeindustry, both nationally and internationallyand to engage with different stakeholders onthese issues.

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Recommendations fromthe Wayanad Meet

To the Government of India

1. Provide immediate relief to the small coffeegrowers’ families where suicides have taken placesince 90 percent of the suicides have beencommitted by male members leaving thedependent female members and childrenhelpless.

2. Reschedule the loans on softer terms for themarginalized small growers and desist the banksfrom taking over the coffee holdings.

3. Provide technical and marketing assistance tosmall and marginalized farmers.

4. Provide credit schemes and debt managementservices.

5. Ensure that in the large plantations the labourlaws are not violated and the standards laiddown by the ILO on decent work aremaintained.

6. Strengthen the social security mechanism ofcoffee estate workers. For this, special agencies,an implementation mechanism and a fund mustbe created. The trade unions should be involvedin the implementation and monitoring stages,.

7. Provide incentives and encouragement for smallgrowers to go for alternative market interventionpractices.

8. Make preferential procurement of coffee fordifferent government departments, whichadheres to acceptable codes of conduct andprovide incentives for such companies thatadheres to such codes.

9. Create a separate department within the Coffee

Board dedicated to small and marginalized coffeefarmers.

10. Support the ICO’s Coffee Quality-improvement Programme and other qualityprojects as a means of improving consumerappreciation and consumption of coffee inIndia.

To Non-Governmental Organizations

1. Technical assistance and other commercial-oriented support including quality improvementtraining, sales, and marketing skill building,support of participation in trade shows could beprovided by the NGOs.

2. Training for coffee small growers on social,economic and environmental aspects to improvetheir understanding of the coffee value-chain.

3. Adapt codes of conducts to the local realities ofIndia through a participatory process.

4. The small and marginal farmers owning betweenone and five acres of land often goes either

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unrepresented or do not have any voice in thepowerful small growers’ associations. Thesemarginal farmers need to be organized wherethey don’t have organizations and strengthen theexisting ones so that their ability to compete inthe market place improves.

5. Support broad-based rural developmentincluding the development of local processingcapacity and producer-associations, and measuresto improve credit and risk management facilities.

6. Help the small and marginal farmers enter intoregional and international alliances.

7. Encourage coffee roasters and traders toimplement an effective code of conduct.

8. Support market intervention efforts of smallcoffee growers.

9. Initiate counselling centres for the distressedcoffee farmers.

Roasters and Traders

1. Take responsibility for conditions in the entirecoffee value-chain, particularly where they have in

a position to influence.

2. Pay remunerative prices to small coffee growersand provide support.

3. Provide support to small coffee growers throughtechnical and marketing assistance.

4. Engage in comprehensive dialogue withrepresentatives of marginal coffee growers’ formsand CSOs working with them.

5. Initiate a disintermediation process bypurchasing as much as possible directly from thesmall coffee growers and provide additional pricefor the coffee produced in a sustainable process.

6. Do not lobby to dilute the social protectionsavailable to coffee estate workers.

7. Conduct multi-stakeholder monitoring andverification of social and environmentalstandards in coffee estates from where coffee isprocured.

International Coffee Organization

1. The ICO should work with member-governments, private sector and civil society groupsto stimulate access to credit for small producer-organizations and establish risk-managementfacilities and tools suitable for use by under-resourced small farmers.

2. Expand coffee consumptions in non-traditionalmarkets and maintain consumption levels intraditional markets through qualitymaintenance, developing niche markets anddisseminating positive and objectiveinformation.

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We, the small coffee growers and workers, along with representatives of Civil Society Organizations (CSOs) and academiciansfrom India and elsewhere assembled at Sultan Bathery in Wayanad district of Kerala, India, for a two-day convention on April12 and 13, 2007 to deliberate on issues and challenges confronting the coffee sector and to devise ways and means of adoptingan agenda to make this sector truly sustainable and transparent.

We represent hundreds of thousands of struggling coffee growers and workers spread over three continents in the Southernhemisphere at the first-ever such international convention facilitated by the South Indian Coffee Growers Association andPartners in Change, a not-for-profit organization in India.

We realize that in the last few years, international coffee market has begun to recover. Nevertheless, the recovery has not led toan end of the impact of the coffee crisis. Indian small coffee growers, like their counterparts from other parts of the coffee-producing world, still sell their coffee beans for much less than they cost to produce. Small-scale coffee farmers and workersare still vulnerable to price swings and the disproportionate market power of local buyers, international traders and multinationalcoffee companies. Such a situation at the beginning of the coffee chain affects the quality of coffee produced and, in the longrun, affects all stakeholders in the supply chain.

We also recognize that in different coffee-producing countries working conditions are becoming difficult because of lowwages, pathetic living accommodations and absence of rights. Pesticides are used indiscriminately, without protective clothingand trade unions are either threatened or domesticated. The challenges associated with coffee are similar to other commoditiessuch as tea, sugar, pepper, vanilla, and cotton. Sustainable coffee industry could provide a useful example to these othersectors. .

We believe that improved social, environmental and economic practices of all stakeholders across the supply chain can lead toremunerative prices for small coffee growers and fair wages to workers, on the one hand, and better access to markets, cost-reduction, increased workers’ loyalty and improved environmental management, on the other.

We also believe that stakeholder cooperation between producers, NGOs/CSOs, governments, export organizations andinternational buyers is necessary in order to overcome the geographical boundaries of the producing country. Hence, we callupon the stakeholders at the upper end of the value chain to recognize the urgent need of radically alter their sourcing practicesand ensure that a proportionate share of the value is passed on to the lower end of the value chain, especially to the smallgrowers and workers.

We have agreed that there is a need to develop a coherent, collective and coordinated approach by small-holders, workers andtheir representatives and the NGOs/CSOs on quality -social, economic, and environmental- in the coffee industry, both nationallyand internationally.

Towards this direction, we declare our commitment to form regional committees in Kerala, Karnataka and Tamil Nadu which willwork with all stakeholders in the coffee sector and to come together as a National Coordination Body for small coffee growers,workers, their representatives and the NGOs/CSOs that work with us.

Based on the recommendations arrived at the Wayanad convention, we commit ourselves to continue this dialogue, to evaluatethe challenges we face and to propose solutions to hardships faced by small coffee growers and workers, wherever they are.

WAYANAD DECLARATION OF SMALLCOFFEE GROWERS AND WORKERS

13 April 2007 : : Sultan Bathery, Wayanad, Kerala

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Taking the Meet to Town

One undeclared objective of the Meet was to raise publicawareness in Sultan Bathery, the venue of the Meet and inthe surrounding areas on the plight of coffee workers andgrowers. In fulfillment of this objective, concerns and issuesof the coffee sector were brought to the attention of thepublic on three occasions – the first, through several pre-event public announcements at various locations in the town(pictures on this page), the second, in the evening of the firstday of the conference – April 12 – through a public meetingin the heart of the town and the third on the morning of theconcluding day by taking out a procession (pictures on facingpage) through town to the venue.

The press too played a significant role in highlighting theissue through print and electronic media.

Above and below: scenes from the road show prior to the meet

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Sri Devasia, Convener of the Meet welcomes the gathering at the public meeting

Representatives of Kenyan and Brazilian coffee growers and plantation workers at the public meeting

An attentitive audience Representing te Indian coffee sector

Scenes from the rally on the concluding day of the meet15

The Dutch Coalition is a network of six Holland-based not-for-profit organizations engaged indevelopment activities in the Southern Hemisphere.The Coalition expresses solidarity with coffee workersand small growers, who are the beginning of the coffeechain in coffee-producing countries. The Coalitioncampaigns in Europe to bring to the attention of thelarge coffee-consuming countries the plight of smallgrowers and workers in the Third World.

The Coffee Coalition has a presence in LatinAmerica through the Brazilian Coffee Alliance, inAfrica through the Kenya Coffee Solidarity Networkand in Asia through Partners in Change, workinghard to bring coffee growers and workers on acommon platform in India.

The objectives of Coffee Coalition are to:

Improve the working and living conditions atthe beginning of the coffee supply chain.

Stimulate the purchase of certified coffee byroaster companies and supermarkets in theNetherlands (towards 100%!).

Involve NGOs and unions in coffee-producing countries in the development,implementation and control of codes ofconduct.

The share of consumption of certified coffee inNetherlands has risen from 2.9 percent in 2001 to28.6 percent in 2006, as a result of the incessantcampaign of Coffee Coalition.

Netherlands, Italy, Russia and Germany are thebiggest importers of Indian coffee, with Netherlandsaccounting for 5 percent and Germany accountingfor 11 percent of the total export of 233,000 tonswhich represent 80 percent of all coffee produced inIndia. Certified coffee accounts for only aminuscule portion of this.

Certified coffee is a trade manifestation of thesocial commitment of corporates in ensuring thatworking and living conditions of the people at thebeginning of the coffee-chain is given a fair deal.Certified coffee calls for a code of conduct toadhere to which has social, economic andenvironmental commitments to deliver. By buyingcertified coffee at a slightly higher price, the buyeracknowledges the mandates of the certification andthe producers and workers get a better price.

Certified coffee is gaining ground in Europethrough the active trade promotion of Fair Trade,Rainforest Alliance and 4C. In 2004, only oneroaster - Kraft - imported certified coffee intoGermany. This year as many as four companies,including Nestle, the world’s largest retailer ofpremium coffee are importing certified coffee intoGermany.

Coffee Coalition has identified the followingchallenges in promoting certified coffee in Europe:

• Initiate campaigns in Germany and otherEuropean countries to increase the demandfor certified coffee (European Initiative May2007 in Germany)

• Follow-up of the promises by the differentmultinationals: Kraft, Tchibo, Nestle and Lidl

• Involve stakeholders in the coffee producingcountries: Coffee product standards shouldhave a real social impact and not excludesmall-scale farmers.

Coffee Coalition is in solidarity with the smallfarmers and workers of the coffee-growing regions ofIndia. We convey our best wishes for the success ofthis Coffee Meet.

Certified Coffee - a fair deal

– Baerbel Weiligmann, Dutch Coffee Coalition

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Impact of Coffee Crisis in India

Shatadru Chattodhpadhayay

Coffee industry in India has witnessed a major crisiscaused by falling coffee prices. Several plantationshave either closed down or switched to other cropslike tea.

One estimate says that coffee plantations inSouth India faced a revenue loss of Rs. 1,960 crores(19.6 bn). The status of the plantation sector is“precarious and, unless prices improve, the entireindustry will close down,” according that source.

In Wayanad, because of the fall in coffee pricesmany coffee plantations have closed down. In placeswhere coffee plantations are still working, theemployers have cut down the number of workers ina major way. Before the crisis it was estimated thatthere were 55,000 workers; it is now down to40,000. Majority of the workers who are affectedare tribals, who primarily work as plantationworkers and do not own agricultural land. One fall-out is that children are working to augment familyincomes.

In Karnataka, most of the organized coffeeworkers are located in Coorg in Kodagu District.The fall in coffee prices has led to lesser days ofemployment for the workers, but there are nomajor reports of closures of the estates. The tradeunion movement is weak in this region, and the factthat wages were fixed in 1999 under a tripartiteagreement involving the Government, the KarnatakaPlanters’ Association and the trade unions is anevidence of this.

In Tamil Nadu, there are 320 estates whichcome under the estate system of coffee production.Out of that, 214 are between 10 and 20 hectares.Tamil Nadu, being a predominantly tea-producingstate, coffee is grown alongside tea. Therefore,during the coffee crisis, the workers were

accommodated in the tea plantations. Some of theexclusive coffee estates have converted themselvesinto tea estates in the Nilgiris like Glenburn Estate.Some of the estates have left only one division forcoffee and are concentrating on tea. There are someexclusive coffee estates in Gudalur region of TamilNadu like Sengel Estate which has 800 acres ofcoffee but there is no union representation there.

Between May 2001 and June 2004, 120 farmerscommitted suicide in Wayanad, 24 of them in thelast six months alone. Trapped in a vicious cycle ofmounting loan liabilities, they opted to resort tothe ultimate step. This fact brings to the fore themagnitude of the economic collapse that prevails inthe district.

The situation of the small coffee-growers ofKarnataka is not different from their counterparts inKerala. Most of the small coffee-growers areindebted and have even begun working in largerplantations as casual labourers on lesser wages.

In the Malnad region, the coffee growingpeasantry is seriously indebted. Most peasants arenot able to repay debts and have tried to sell theirlands. But land rates have fallen to Rs 115,000 peracre from Rs 450,000. Often, this is inadequate topay off the loans.

Suicide deaths have become a regular feature inrural Karnataka. To date more than 200 peasantshave reportedly committed suicide, unable tograpple with the crisis. The situation reached suchan alarming proportion that the Governmentthrough the Zilla Panchayats and officials fromdifferent departments have initiated meetings withthe small coffee-growers to discuss different waysprevent the growers from taking the extreme step.

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Kenya Coffee Solidarity Network (KCSN), initiatedin 2003, is a coalition of like-minded civil societygroups that have come together and subscribed to acommon objective of bringing together stakeholdersin the coffee sector to a win-win situation.

KCSN was born out of the need to help workersin plantations to address their problems withemployers through dialogue. Labour rights, goodsanitation, health and safety of workers and how tocollectively build good negotiations, are some of theissues addressed by KCSN. On the other hand,employers are to be informed of the problems thatface workers, as many workers, due to ignorance,lack the requisite knowledge and hold back for fearof victimization.

One of the achievements by KCSN is theentrenchment of corporate social responsibility incompanies. At the beginning, many companies sawthis as spending all their profits for the benefit ofworkers and the community. Through dialogue andeducation, it has become one of the latest tools thathas promoted dialogue in the agricultural sector.

The need for certification became so importantand due to employment opportunities that aboundin the agricultural sector, dissemination ofinformation became valued. KCSN opined that tochange the state and living conditions of workers, itis only CSR that would effectively bring allstakeholders on board. This initiative has seenemployers put up health clinics for their workers,build schools for communities around them andaggressively being involved in the conservation of theenvironment. Roads and railways have beenconstructed by some companies to facilitatetransport of goods and this has greatly benefited thecommunities.

The smallholder still remains weak and moreeffort, especially to educate farmers is of primaryconcern to KCSN. Their vulnerability is out ofmarginalization in terms of capacity building andincentives that would aid and increase production.The biggest challenge Kenya’s small-scale growers arefacing is inadequate capacity that would lead tomeshing of effort and provide one integral voice.The other factor has been politicization of the coffeesector, which has developed intrinsic political unitsthrough co-operatives, and this has had far reachingnegative consequences on the farmers.

KCSN’s aim is to see that producers takeresponsibility of their environment. It is to see thatthere is a well nurtured bio-diversity which canpositively contribute to eco-tourism and impact onthe economy.

A pilot project between KCSN and Socfinaf hasrealized a well-structured policy on corporate socialresponsibility, which is now a masterpiece of thecompany. This broad based policy documentaddresses and puts in place measures on social,economic and environmental issues with greatemphasis on the rights of workers as partners inbusiness. The all inclusive policy document bySocfinaf has already given its first fruit, whichthrough improved working conditions,establishment of various worker committees andcontinued identification of hazards at workplace iswhat is needed for continuous improvement.

CSR in Kenya gaining ground

George Mwamodo, Coordinator, Kenya Coffee Solidarity Network

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Brazil is the world’s leading coffee producer andexporter with a production of over million bags ofcoffee beans every year. In recent years it has beenproducing between 32 and 45 million bags. Ofthis about 80 percent is Arabica and the remainingis Robusta. In 2005 it exported 26 million bags ofgreen coffee.

Although Brazil has the good fortune of being amassive domestic consumer of coffee beverages,with nearly 14 million bags, the international crisisis hurting Brazil’s estimated 350,000 coffeegrowers. Almost 70 percent of them are smallfarmers who own up to 20 hectares in about300,000 farms, each producing up to 300 bags (60kilograms each) of coffee beans every year. Theyaccount for 20 percent of the total production. Ofthe rest, 20 percent are medium-sized farmers withholdings from 20 to 200 hectares that produce300 to 3000 bags of beans annually andaccounting for 40 percent of the total production.Only 10 percent of the producers can be called“large.” The large producers account for 40 percentof the total production. The entire chain of coffeeproduction employs eight million people in thiscountry of 178 million people.

The crisis is so deep-rooted that many haveabandoned the crop and even left the land, whichhas fed unemployment in the sector. Even with abumper harvest forecast for next year and no signof a pick up in demand, it is likely that many smallfarmers will go bust.

The coffee crisis “is an economic and socialdisaster.” The crisis arose as a result of adjustmentsin the world coffee production after the end of theInternational Coffee Agreement in 1989. Up untilthat year, the coffee trade was managed – there was

a balance between supply and demand. Since then,it has been governed by market rules. At the sametime, transnational roasters became more powerfuland sliced out huge profits for themselves.

The “Big Four” roasters – Nestlé, Kraft Foods,Procter & Gamble, and Sara Lee–- began to definehow the retail market would operate, based on thetrade of widely known brands. Together with thefifth largest roaster in the world, Tchibo, whichtrades the product in Germany, they buy almosthalf the world’s coffee beans. In Brazil, Sara Leedominates one-fourth of the domestic roastingmarket and Nestlé is the leader of the domesticinstant coffee market.

The crisis is causing losses to over 3 millionBrazilians in rural areas. If we include all the coffeeproduction chain, the impacts of the crisis mayaffect over 8 million men and women. This trademodel, based on unequal rules, is affecting farmerswho grow other commodities as well. Trade barriersand taxes created by the governments of developedcountries make it difficult for exports fromperipheral countries to access their markets.

In Brazil, this situation is aggravated by the hugeconcentration of income, one of highest in theworld according to the United NationsDevelopment Program (UNDP). In a list of 116nations, Brazil only ranks lower than Africancountries like Sierra Leone, Central AfricanRepublic, and Swaziland. The unequal distributionof resources in rural areas increases social inequities.Although family farms represent 85 percent of allrural estates, occupy one-third of the total area, andaccount for 38 percent of the domestic agricultural/livestock production, they only receive 25 percentof all credit allocated to agricultural activities.

Brazil’s Coffee Sector in Crisis

Sjoerd Panhuysen

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A small region like ours, while, evolvingstrategies in a deeply entrenchedmarket of the world, must rememberthat we are not playing with equalsand therefore must fashion ouractions taking into account the realitiesof the situation without being tootheoretical or dogmatic.

It must be remembered that economicgrowth in countries creates higherpurchasing power and more space forcoffee in domestic or personal budgets.The richer they become, the more coffeethey drink. This makes price bands moreelastic and consumption becomes lesssusceptible to price changes.

The smallholder still remains weak andmore efforts, especially to educatefarmers, are needed. Their vulnerabilityis out of marginalization in terms ofcapacity-building and incentives thatwould aid and increase production.

Kerala occupies second position in areaand production of coffee in the countyafter Karnataka. Coffee is grown inabout 84,735 hectares. Around 80% ofcoffee area is in Wayanad district and therest is spread over. Yet, the peopledepending on this sector have found novoice in the policies of the State.

In Kerala, Wayand is the only districtwhere coffee is the main souree oflivelihood for the majority of the

people. From small growers to largegrowers and the workers depending

upon them are living out of theincome derived from coffee.

Voices of Concern

Pramod JohnSr. Program Manager

Partners in Change

Organising this Meet has been achallenging experience for all involved.

We have come up with good resolutionsand the challenge in the forthcoming

months is to have them brought tofruition. PiC is committed to journey

with the stakeholders in this.

It is sad that the International CoffeeOrganization has failed to address the

economic plight of millions of smallfarmers. In the global coffee debate,

international coffee has missed agolden opportunity to give poor

farmers, a greater voice.

A.C. VarkeyFarmers Relief Forum

Tomy MathewElements

Kozhikode

C. A. SubbaiahSmall Growers

Assocoiation Coorg

While corporate interests arepredominantly represented and have

forums for dedicated discussion topromote their interests, the largest

stakeholders, the small producers, havelittle or no say in the prices.

Roy DavidCORD,

Kushal Nagar, Karnataka

K.J. DevasiaSouth India Coffee

Growers Association

M.NallamuthuNMPWU,

Yercaud, Tamil Nadu

M.A. Mohammed Jamal,Planter &

Public Worker

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List of Participating Organisations

1 Indian National Congress (I), Sulthan Bathery

2 Indian Union Muslim League, Sulthan Bathery

3 Nationalist Congress Party, Sulthan Bathery

4 Bharateeya Janatha Party, Sulthan Bathery

5 Kerala Congress (M), Sulthan Bathery

6 Communist Marxist Party, Sulthan Bathery

7 Janatha Dal (S), Sulthan Bathery

8 Karshaka Congress (I), Sulthan Bathery

9 Farmers’ Relief Forum, Kalpatta

10 Hilda, Sulthan Bathery

11 Swaminathan Foundation, Calicut

12 Rastha , Sulthan Bathery

13 Wayanad Social Service Society, Sulthan Bathery

14 Uravu, Sulthan Bathery

15 Swaminathan Karshaka Sangam, Calicut

16 Kisan Janatha, Sulthan Bathery

17 Kerala Karshaka Union (M), Calicut

18 Haritha Sena, Sulthan Bathery

19 Nationalist Karshaka Congress, Sulthan Bathery

20 Indian National Trade Union Congress, Kerala

21.Indian National Labour Congress, Kerala

22. Kerala Trade Union Congress, Kerala

23. Servarayan Trade Union, Tamil Nadu

24 Edakkal Nature Lovers’ Forum, Kalpatta

25 Centre for Political Science, Kerala

26 Wayanad Coffee Growers’ Association

27 Kerala Bar Federation, Calicut

28 Neela Malai Plantation Workers’ Union, Yercad,Tamil Nadu

29 Small Growers’ Association, Coorg, Karnataka

30 Karna Planters’ Association, Kushalnagar,Karnataka

31.Coorg Organisation for Rural Development,Kushalnagar , Karnataka

32.Indocert, Cochin

33.Fair Trade Alliance-Kerala

34.Tamil Manila KettidaTS, Chennai, Tamil Nadu

35.Hivos, Bangalore, Karnataka

36.Budagattu Krishigara Sangha, Karnataka

37.Centad, New Delhi

38.Novb-Oxtam, New Delhi

40 INFACT, Palai, Kerala

41 Elements, Calicut, Kerala

42.Coffee Coalitie, The Netherlands

In their individual capacity

1. Adv. Venketasubramania, former Vice-Chairman,Coffee Board, India

2. Adv. K. Moidu, former Vice-Chairman, CoffeeBoard, India

3. K.C. Rosakutty Teacher, Teacher, formerMember of Legislative Assembly, Kerala

4. N.D. Appachan, former Member of LegislativeAssembly, Kerala

5. M.V. Sreyams Kumar, Member of LegislativeAssembly, Kerala.

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